NAIJAFEED

Wednesday, July 7, 2021

Thriving Under Pressure: Why Crypto Is Booming in Nigeria Despite the Banking Ban

Nigeria’s regulators tried to crack down on cryptocurrency. Now, a few months later, it’s clear their efforts haven’t worked. The nation is a prime example of how people will turn to crypto to cope with a struggling economy despite the prohibitive stance of the state.

In February, the Central Bank of Nigeria ordered banks to “identify persons and/or entities” who were conducting transactions in crypto or running crypto exchanges and “ensure that such accounts are closed immediately.” But that ban didn’t stamp out bitcoin in Nigeria. Rather, the crypto community turned to peer-to-peer trades, or sending payments directly to each other.

According to the blockchain research firm Chainalysis, the dollar volume of crypto received by users in Nigeria has been consistently growing in 2020 and 2021, which may be partly related to this year’s bull market. In May, Nigeria received $2.4 billion worth of crypto, compared with $684 million last December, the analytics firm said.

While that kind of geographical data comes with caveats, it’s clear that crypto is alive and well in Nigeria.

Wealth without borders

According to a survey in March by Statista, 32% of respondents in Nigeria use crypto. Nigeria also ranked eighth in Chainalysis’ 2020 report on cryptocurrency adoption around the world.

The interest in crypto surged last fall, when activists with the “EndSARS” movement, protesting against police brutality in Nigeria, used bitcoin to raise funds.

Economic factors also appear to spur adoption.

“Recently, the devaluation of our local currency [encouraged] people [to start] saving in crypto assets like bitcoin and ethereum,” said Udeaja Kingsley, CEO of the BiTA crypto startup, adding that the crypto users are “mostly the youths that believe in it and are trading it via the means of P2P.”

So far in 2021, the Nigerian naira has been losing value with the country’s inflation rate at 18%. While U.S. dollars might be hard to obtain in Nigeria, bitcoin sometimes serves as a proxy for the dollar, allowing people to hedge against naira’s inflation. Because most of the goods Nigerians buy are imported, U.S. dollars are in high demand and there is often not enough of them available on the market.

However, some of Nigeria’s importers already switched to crypto as a payment method, says Keith Mali Chung, president and co-founder of Loopblock Network, an African blockchain firm. “Over 70% of all that is being consumed in Nigeria is imported, and with financial restrictions, bitcoin is gaining all the attention it deserves,” he said.

Chinese merchants selling clothing and electronics in Nigeria are using crypto as a means of exchange, Chung said. The pattern is similar to the one in Eastern Europe, where Chinese merchants might be sending tens of millions of dollars in crypto across the border daily.

It’s hard to estimate how much money is moving from Nigeria to China this way, Chung said, but he has some anecdotal evidence. “I know of individual [merchants] who transact over $2 million to $5 million daily, and they are countless, and the numbers are rapidly increasing,” he said.

According to Chung, some young Nigerians view bitcoin and smaller, newer cryptocurrencies as a way to make some money as the traditional economy lags because of the pandemic.

“A lot of people are taking advantage of the [decentralized finance] industry right now, it’s giving equal financial opportunities for all, irrespective of nationality or whatsoever,” Chung said. “A lot of people are jumping into different yield farming programs, I know quite a number of people who got DeFi loans to run their businesses,” he added.

Ray Youssef, CEO of Paxful, a service that enables users to buy and sell bitcoin in a peer-to-peer fashion, believes the biggest factor of crypto’s popularity in Nigeria has been “the intense drive and business aptitude of the Nigerian youth.”

“Entrepreneurship is baked into their DNA,” Youssef told CoinDesk via a spokesperson.

Frozen accounts

The Nigerian government, and the Central Bank of Nigeria in particular, haven’t been openly hostile to crypto. Commenting on the controversial banking ban during a public event in March, Adamu Lamtek, the central bank’s deputy governor, said the regulator had never banned cryptocurrency activity in Nigeria altogether; rather, it only prohibited banking services for crypto businesses.

For some crypto firms on the ground, however, Nigeria’s reality remains tough.

Luno, the crypto wallet owned by Digital Currency Group (also CoinDesk’s parent company), has had fiat deposits and withdrawal frozen since February, it said in a recent statement by the CEO Marcus Swanepoel.

Although the company managed to get its bank account in Nigeria unfrozen in June, users still can’t move their fiat funds to and from the platform, Swanepoel said, adding that the company “intensified regulatory lobbying” to get the issue sorted out.

“We are negotiating day and night with the relevant stakeholders in Nigeria to get them to collectively work with the government to find a solution that works for everyone,” he added. “This includes the CBN and other crypto platforms, and allowing people to withdraw is the main priority.”

Chike Okonkwo, sales and partnerships lead in Africa for an asset manager Thresh0ld, and also a member of the Stakeholders in Blockchain Technology Association of Nigeria (SiBAN), said the crypto community has been trying to talk with the central bank, but hasn’t heard back so far.

He says SiBAN, along with other two organizations, Blockchain Nigeria User Group and Cryptography Development Initiative of Nigeria, has been working to get on the same page with regulators for a while.

“We have been having meetings with the [Securities and Exchange Commission, the country’s securities regulator] before the CBN ban news but due to the fact that the CBN did what they did, the SEC had to pause their own plans,” Okonkwo said.

Nigeria’s SEC announced in February that it’s putting on hold its own plans to regulate crypto because of the CBN’s ban.

P2P boom

Crypto communities world-wide have found ways around government restrictions, and Nigeria is no exception.

According to Paxful’s Youssef, after the Central Bank of Nigeria banned crypto-related bank transfers in February Nigerians sent even more bank wires purchasing bitcoin than before. Paxful is “on pace” to have 23% more trades funded with bank transfers in Nigeria than last year, and 36% more in terms of volume, Youssef said.

Nigeria is the largest market for the company, with around 1.5 million users and over $1.5 billion trading volume, according to Paxful.

According to UsefulTulips, in the first half of 2021 the volumes of two major P2P platforms in Nigeria, Paxful and LocalBitcoins, were the largest in Africa, totaling over $200 million.

During the first five months of 2021, Nigerians traded 50% more than the same period last year on LocalBitcoins, said Jukka Blomberg, LocalBitcoins’ chief marketing officer, adding that new registrations have also increased this year.

That activity may be at least partly explained by the fact that P2P trades are not easy for government officials to trace. When people send money directly from one personal account to another, without channeling it through a third party, it’s hard to see how exactly individuals are using the money. It could be for bitcoin they purchased from someone, their apartment’s monthly rent or paying back a debt to a friend.

It would thus be difficult, if not impossible, for banks to “ensure that such accounts are closed immediately,” as the Central Bank of Nigeria ordered.

Turning to peer-to-peer transactions might actually make the crypto ecosystem in Nigeria healthier and more resilient, according to Yele Bademosi, CEO of the Africa-focused crypto app Bundle.

“In my opinion, we got too comfortable about the fact that we were relying on centralized rails and channels to on/off ramp crypto,” Bademosi told CoinDesk. “In the ethos of bitcoin, P2P methods are more resilient as they don’t have a central point of failure.”

Nigeria is part of a larger regional trend. Africa has seen a wild 386.93% increase in P2P trade volumes on Binance since January, according to Damilola Odufuwa, Binance’s spokeswoman in Africa. The user count across the continent grew 2,228.21% over those same four months, she added. The company declined to reveal specific data on Nigeria.

By Anna Baydakova

Coindesk

Nneka, Chiney, Erica Ogwumike, all listed on Nigeria's provisional roster, could play in Olympics together

Sisters Nneka, Chiney and Erica Ogwumike are listed on the provisional roster for Nigeria's women's basketball team, the country's federation announced Tuesday on Twitter. It's possible they all could make the 12-player roster for Nigeria in the upcoming Tokyo Olympics, although Nneka and Chiney are still awaiting official FIBA clearance.

"It's something I know my family would be very proud of," Nneka Ogwumike told ESPN Tuesday. "For it to happen would be such a blessing. To be able to do something big for a big part of our heritage would be fantastic. I'm hoping it will contribute to the growth we're experiencing for Africa in basketball."

Nneka, the 2016 WNBA MVP, and Chiney both are Stanford grads who were the WNBA's No. 1 draft picks in 2012 and 2014, respectively, and now play for the Los Angeles Sparks. Erica Ogwumike played as a freshman for Pepperdine and then spent the rest of her college career at Rice. She was drafted into the WNBA in 2020 but did not make a roster.

Eldest sister Nneka, 31, is a longtime member of the U.S. senior national team, winning gold medals with the American squad in 2014 and 2018 at the FIBA Women's Basketball World Cup. But she was left off the U.S. roster for the Tokyo Games, which was announced June 21, surprising many and causing some controversy. She is the only MVP in WNBA history who has not made an Olympic squad, but that could change with FIBA's approval.

"It was more of a hurt than a shock, because I had experienced it before," Nneka said of also not being named to the U.S. Olympic team in 2012 and 2016. "But there are decisions made in this life that you can't control. I allowed myself to feel the hurt, but moving on, I decided, 'I'm going to try to put matters in my own hands."

Nneka contacted USA Basketball and told them she was interested in pursuing a chance to play with Nigeria. The Ogwumikes' parents, Peter and Ify, were both born in Nigeria and immigrated to the United States, where their daughters were born. The Ogwumike sisters have dual citizenship with the United States and Nigeria.

USA Basketball has released both Nneka and Chiney, which was required since both previously have competed for the United States in FIBA-sanctioned events. Generally, if players have done that after having reached their 17th birthday, they are not allowed to play for another country in a FIBA event. However, according to FIBA's regulations on player eligibility, the organization's secretary general may authorize a player to compete for the national team of his or her country of origin if this is in the interest of the growth of basketball in that country.

One of FIBA's pillars of emphasis currently is the growth of women's basketball worldwide, which could favor the decision for Nneka and Chiney getting to play for Nigeria. Erica Ogwumike committed to the Nigerian team last year; she had not played for Team USA in a FIBA-sanctioned event. Chiney Ogwumike began looking into the possibility of representing Nigeria about two months ago.

"The running joke was who was the family going to root for, because I was planning on playing against Erica," Nneka said of thinking she would be on Team USA. "But, you know, life unfolds in some beautiful ways: To be able to possibly share the highest athletic honor with not only Chiney, but my youngest sister."

Nneka has not been critical of USA Basketball, but said that when she didn't make the U.S. team, she did not want to wait on the possibility of perhaps being called on as an alternate U.S. player if someone was hurt between now and the Tokyo Games. She's been in that position before and said she doesn't see herself as a "second choice."

"I just wanted to bet on myself and also be a part of an organization that prioritizes me," she said of her hopes to play for Team Nigeria now. "My perspective was like, 'If it's not impossible, I'm going to go for it.' Because I believe I have Olympic status and I plan on being an Olympian."

Nneka said she wanted to be fully open with the Nigerian federation and USA Basketball about her hopes.

"I didn't want it to be secretive," she said. "It was something that I wanted to do, and I would hope that they understood. And they did. In these moments, being transparent, I think, is most important."

Along with FIBA clearance -- the Ogwumikes are not sure when a final decision will be made on that -- and being named to the Nigerian team, both Nneka and Chiney also have to be healthy. They have been sidelined with knee injuries; Nneka last played for the Sparks on June 1, and Chiney on May 28. At this point, both anticipate being able to play in Tokyo if they are on the team. Nigeria is scheduled to face the United States in an exhibition on July 18 at Michelob Ultra Arena at Mandalay Bay in Las Vegas. Not long after, the Nigerian team is expected to be named.

"The way I feel now, I think I would be ready," Nneka said of playing in that exhibition game. "But if I'm not, I'll be ready for Tokyo if I'm able to get through the clearance process. The plan from the beginning (of her injury recovery) was for me to be ready for the Olympics."

Nigeria is in Group B at the Tokyo Games, along with the United States, Japan and France. Another current WNBA player who previously played for USA Basketball, Atlanta's Elizabeth Williams, is on the Nigerian provisional roster, too, and went through a similar process to what Nneka and Chiney are now.

Williams played collegiately for Duke; current Blue Devil senior Elizabeth Balogun, who transferred from Louisville, is also on the roster, as is another former Blue Devil, Oderah Chidom.

In fact, all the players on Nigeria's provisional roster played collegiately in the United States, including Adaora Elonu, who won a national championship with Texas A&M in 2011.

"The last few years, I've had the experience of playing against Team Nigeria and seen the rise of it," Nneka said. "It fills me with a lot of pride. To be able to possibly have the opportunity to contribute, that's what I want to do."

ESPN

Monday, July 5, 2021

Nigeria gunmen kidnap 'nurses and infants' from hospital

Gunmen in Nigeria have abducted at least eight people from a hospital in the north-west of the country, police say.

The attack took place at the National Tuberculosis and Leprosy Centre in Zaria early on Sunday morning.

Reports say the number of people taken by the group is higher and includes nurses and children.

There has been a recent spate of abductions from schools and universities for ransom.

Police said the gunmen, thought to be from criminal groups known locally as "bandits", opened fire on a police station in the city.

While they were engaged in the shootout, another group attacked the hospital.

"The attack on the police station was a distraction whilst another group attacked the dormitories of the health centre workers," a local resident told AFP news agency.

The group escaped with the victims into a nearby forest.

A hospital worker, who asked not to be named, told BBC Hausa that the gunmen had abducted at least 12 people, including three children under the age of three and a teenager.

A local government official said troops were stepping up efforts to find the victims.

Kidnappings are common across the country.

Authorities say recent attacks on schools in the north-west have been carried out by bandits, a loose term for kidnappers, armed robbers, cattle rustlers and other armed militia operating in the region who are largely motivated by money.

Since the well-publicised abduction in 2014 of 276 schoolgirls from Chibok secondary school by Boko Haram Islamist militants in Borno state, more armed groups have resorted to mass abduction of students.

No end in sight to wave of kidnappings

Analysis by Mayeni Jones, BBC News, Lagos

Once again the northern state of Kaduna finds itself in the eye of Nigeria's kidnapping storm.

This latest attack is shocking in that it reportedly involves three infants, but this is not the first time a hospital has been targeted.

In late April, armed gunmen took two female nurses from a hospital in Kajuru area of Kaduna state. Schools and universities in the state have also been repeatedly targeted by kidnappers since March.

The state governor told the BBC that he believes kidnappers have come to Kaduna from other states, because he's been vocal about his decision not to engage with kidnappers in any way.

But now even Governor Nasir El Rufai has succumbed to pressure from the kidnappers - he recently withdrew his son from a local school where he had enrolled him to promote confidence in public schools. He told the BBC that he'd decided to take his son out to protect other pupils. This latest move will embolden his critics who say his tough stance is counter-productive.

But kidnappings continue to take place, both in states where governors engage with kidnappers, and in states where they don't.

With few economic prospects for many young Nigerians, and with security forces struggling to stop the wave of abductions, it's hard to see how this kidnapping crisis will stop.

BBC

Nigerian families struggle to survive as food prices soar

With inflation rising around the world as the global economy recovers from the coronavirus pandemic, soaring prices are having dramatic consequences in countries like Nigeria.

The number of people living in poverty in Nigeria – Africa’s most populous nation with 210 million inhabitants – was already among the highest in the world.

But as Nigeria has been battered by the double economic effect of low global oil prices and the pandemic, the World Bank estimates the country’s soaring inflation and food prices pushed another seven million people into poverty in 2021.

Food prices have increased more than 22 percent since the start of the coronavirus crisis, according to official statistics.

For many people, feeding their family has become a daily challenge.

“Every day, during consultations, there are five or seven children that suffer from malnutrition,” says Emiolo Ogunsola, head of the nutrition department at Massey Street children’s hospital in a poor district in Lagos Island.

“I bet in a few months or a year, more children will be malnourished.”

Even before the pandemic and the surge in food costs, Nigeria’s nutrition figures were alarming: One in three Nigerian children suffered stunted growth due to a bad diet.

As a result, close to 17 million children in Nigeria are undernourished, giving the country the highest level of malnutrition in Africa and the second-highest in the world.

Al Jazeera

Friday, July 2, 2021

Nigerian Women Lead Reintegration of Ex-Boko Haram Militants

The Nigerian government's efforts to reintegrate former Boko Haram militants has seen hundreds of fighters go through rehabilitation. But it also gets pushback from the conflict's victims, who want the militants to be held accountable. At a conference in the capital, women from the conflict-affected areas are getting support to head up reconciliation between the former terrorists and their communities.

Some 45 women from Nigeria's northeastern states of Borno, Adamawa and Yobe file in for a two-day conference in Abuja.

They're here to discuss a sensitive subject - the reconciliation and reintegration of ex-Boko Haram fighters into their communities.

The conference is a joint initiative by the non-profit Center for Humanitarian Dialogue in Switzerland, U.N. Women and the International Organization for Migration (IOM). It’s designed to promote women-led community peacekeeping in the northeast, said Millicent Lewis-Ojumu, director at Center for Humanitarian Dialogue.

"We know and from experience have seen that when the women are involved in the conversations, peace building, in helping to resolve issues relating to how to reintegrate and rehabilitate former combatants or person's associated with Boko Haram, that they are very effective," said Lewis-Ojumu.

Since launching the safe exit program, “Operation Safe Corridor” for repentant fighters in 2016, authorities say the program has met with resistance from host communities.

The scheme was launched as part of a growing awareness for the use of amnesty to persuade terrorists to lay down their guns. Nearly 1,000 ex-fighters have been rehabilitated under the government's program.

But very few are successfully living in communities. Most of them eventually rejoin Boko Haram due to rejection.

Hamzatu Alamin is one of the participants at the conference. She started talking about reconciliation 10 years ago when her community was hit hard and young men were coerced into joining Boko Haram.

But she said her efforts attracted some unwanted attention.

"You can be arrested by state actors and accused of being an accomplice. And secondly, the boys (Boko Haram), if you make a mistake, you can be their target,” she said.

Women like Alamin here said they hope to improve their community's acceptance of former jihadists after the conference.

But attending the conference along with other women also lifts the burden of being negatively labeled with terrorists.

"I have been communicating with them. I am now able to say it freely because I know that even the government is communicating with them. The government and security forces are using many of the boys I communicate with as outlets to get the people they're rehabilitating,” she said.

Maria Quintero, program manager at IOM Nigeria, said women also need socioeconomic stability if the program is to succeed.

"The Nigerian women are very strong. What we have found as well is that they're very influential in the decision of the males. Women have a role to play especially when it comes to males coming back to the communities,” said Quintero.

More than 35,000 people have been killed and millions displaced since the start of the Boko Haram insurgency in 2009. Boko Haram, which opposes Western education, has frequently targeted schools.

By Timothy Obiezu

VOA